LABOR STANDARDS

AVL
First Semester 2019-2020

I. Fundamental Principles and Policies

A. Constitutional Provisions

1. Article II, Secs. 9, 10, 11, 13, 14, 18, 20

2. Article III, Secs. 1, 4, 7, 8, 10, 16, 18 (2)
3. Article XIII, Secs. 1, 2, 3, 13, 14

1. Espina v. Zamora, G.R. No. 143855, September 21, 2010

 This case determines the constitutionality of the Retail Trade Liberalization Act of 2000 (RA 8762).
o This act repeals RA 1180-- which absolutely prohibits foreign nationals from engaging in the
retail trade business.
o RA 8762 allows foreigners to own retail trade business under four categories.
o Also allows natural-born Filipino citizens, who had lost their citizenship and now reside in
the Philippines, to engage in the same business with the same rights as Filipino citizens.
 On Oct 11, 2000 petitioners filed this petition assailing the constitutionality of the law.

Petitioner/Respondent's Contention
 Petitioners aver that:
o The law runs afoul of Sections 9, 19, and 20 of Article II of the Constitution. As well as
Sections 10, 12, and 13 of Article XII of the Constitution.
 Which enjoins the State to place the national economy under the control of Filipinos
to achieve equal distribution of opportunities, promote industrialization and full
employment, and protect Filipino enterprise against unfair competition and trade
policies.
o The implementation of the law would lead to alien control of the retail trade
o Foreign retailers like Walmart and K-Mart would crush Filipino retailers and sari-sari store
vendors, destroy self-employment, and bring about more unemployment.
o The WB-IMF had improperly imposed the passage of RA 8762 on the government as a
condition for the release of certain loans.
o There is a clear and present danger that the law would promote monopolies or
combinations in restraint of trade
 Respondents aver that:
o Petitioners have no legal standing to file the petition. They cannot invoke the fact that they
are taxpayers or members of Congress.
o The petition does not involve any justiciable controversy; neither does it allege that the
subject law violates the rights of vendors the members of Congress represents
o Petitioners have failed to overcome the presumption of constitutionality of the law. And
Sections 9, 19, and 20 of Article of the Constitution are not self-executing provisions.
o The constitution mandates the regulation but not the prohibition of foreign investments.
 It only directs Congress to reserve to Filipino citizens certain areas of investments, but
it does not prohibit Congress from enacting laws allowing the entry of foreigners into
certain industries not reserved by the Constitution to Filipinos.
Lower Courts
 None.
Issue
1. Whether or not petitioner lawmakers have the legal standing to challenge the constitutionality of
RA 8762
2. Whether or not RA 8762 is unconstitutional
Ruling
1. They don't have standing, but the Court will still resolve the question raised.
a. There is no showing that the law prejudices petitioners or inflicts damage on them. Still the
Court will address the issue since the rule on standing can be relaxed for nontraditional
plaintiffs in cases when public interest so requires or the matter is of transcendental
importance.
2. Law is constitutional.
a. The provisions of Article II of the Constitution are not self-executing. Legislative failure to
pursue such policies cannot give rise to a cause of action in courts (Tanada v. Angara).
b. While Section 19, Article II of the Constitution require the development of a self-reliant and
independent national economy effectively controlled by Filipino entrepreneurs, it does not
impose a policy of Filipino monopoly of the economic environment.
i. While the Constitution mandates a bias in favor of Filipinos goods, services, labor and
enterprises, it also recognizes the need for business exchange with the rest of the
world on the bases of equality and reciprocity and limits protection of Filipino
enterprises only against foreign competition and trade practices that are unfair.
ii. In other words, the Constitution does not rule out the entry of foreign investment,
goods, and services. While it does not encourage their unlimited entry into the
country, it does not prohibit them either.
c. Section 10, Article XII of the Constitution gives Congress the discretion to reserve to
Filipinos certain areas of investments upon the recommendation of NEDA and when the
national interest requires.
i. Which means Congress can determine what policy to pass and when to pass it
depending on the economic exigencies.
ii. The control and regulation of trade in the interest of the public welfare is of course an
exercise of the police power of the State.
iii. In 1954, Congress enacted RA 1180, restricting the retail trade business to
Filipino citizens. In denying the petition assailing it validity for violation of the
foreigner’s right to substantive due process of law, the Supreme Court held that
the law constituted a valid exercise of police power. The State had an interest in
preventing alien control of the retail trade and RA 1180 was reasonably related
to that purpose.
d. Here to the extent that RA 8762 only lessens the restraint on the foreigners' right to
property or to engage in business, but it does not amount to a denial of the Filipinos' right
to property and due process of law.
e. The Court is also not convinced that the law would eventually lead to alien control of the
retail trade business. The law itself provides strict safeguards on foreign participation:
i. Aliens can only engage in retail trade business subject to the categories enumerated
ii. Only nationals from countries which allow the entry of Filipino retailers shall be
allowed to engage in retail trade business
iii. Qualified foreign retailers shall not be allowed to engage in certain retailing activities
outside their accredited stores.
 2. · Manila Water v. Del Rosario, G.R. No. 188747, January 29, 2014

Toyota Motor Phils. Corp. Workers Association (TMPCWA) v. National Labor Relations Commission, we
expanded the exclusions and elucidated that separation pay shall be allowed as a measure of social
justice only in instances where the employee is validly dismissed for causes other than serious
misconduct, willful disobedience, gross and habitual neglect of duty, fraud or willful breach of trust,
commission of a crime against the employer or his family, or those reflecting on his moral character. In
the same case, we instructed the labor officials that they must be most judicious and circumspect in
awarding separation pay or financial assistance as the constitutional policy to provide full protection to
labor is not meant to be an instrument to oppress the employers.

Equity as an exceptional extenuating circumstance does not favor, nor may it be used to reward, the
indolent or the wrongdoer for that matter. This Court will not allow a party, in guise of equity, to benefit
from its own fault.

Central Pangasinan Electric Cooperative, Inc. v. National Labor Relations Commission is on all fours, thus:

Although long years of service might generally be considered for the award of separation benefits or
some form of financial assistance to mitigate the effects of termination, this case is not the appropriate
instance for generosity under the Labor Code nor under our prior decisions. The fact that private
respondent served petitioner for more than twenty years with no negative record prior to his dismissal,
in our view of this case, does not call for such award of benefits, since his violation reflects a regrettable
lack of loyalty and worse, betrayal of the company. If an employee's length of service is to be regarded
as a justification for moderating the penalty of dismissal, such gesture will actually become a prize for
disloyalty, distorting the meaning of social justice and undermining the efforts of labor to cleanse its
ranks of undesirables.(Emphasis supplied).

petitioner's policy of not accepting or considering as disqualified from work any woman worker who
contracts marriage runs afoul of the test of, and the right against, discrimination, afforded all women workers
by our labor laws and by no less than the Constitution.

The fact is that she was dismissed solely because of her concealment of her marital status, and not on the
basis of that supposed defalcation of company funds. That the labor arbiter would thus consider petitioner's
submissions on this supposed dishonesty as a mere afterthought, just to bolster its case for dismissal, is a
perceptive conclusion born of experience in labor cases.

3. Philippine Telegraph v. NLRC, G.R. No. 118978, May 23, 1997

Thus, an employer is required, as a condition sine qua non prior to severance of the employment ties of an
individual under his employ, to convincingly establish, through substantial evidence, the existence of a valid
and just cause in dispensing with the services of such employee, one's labor being regarded as
constitutionally protected property.

it is recognized that regulation of manpower by the company falls within the so-called management
prerogatives, which prescriptions encompass the matter of hiring, supervision of workers, work assignments,
working methods and assignments, as well as regulations on the transfer of employees, lay-off of workers,
and the discipline, dismissal, and recall of employees.

4. · Wesleyan University v. Faculty, G.R. No. 181806, March 12, 2014

The Non-Diminution Rule found in Article 100 of the Labor Code explicitly prohibits employers from
eliminating or reducing the benefits received by their employees. This rule, however, applies only if the
benefit is based on an express policy, a written contract, or has ripened into a practice. To be considered a
practice, it must be consistently and deliberately made by the employer over a long period of time.

An exception to the rule is when "the practice is due to error in the construction or application of a doubtful
or difficult question of law."
These circumstances, taken together, bolster the finding that the two-retirement policy is a practice. Thus,
petitioner cannot, without the consent of respondent, eliminate the two-retirement policy and implement a
one-retirement policy as this would violate the rule on non-diminution of benefits.

5. · Serrano v. Gallant Maritime, G.R. No. 167614, March 24, 2009

This interpretation implies an unimpeachable right to continued employment-a utopian notion, doubtless-
but still hardly within the contemplation of the framers. Subsequent legislation is still needed to define the
parameters of these guaranteed rights to ensure the protection and promotion, not only the rights of the
labor sector, but of the employers' as well. Without specific and pertinent legislation, judicial bodies will be at
a loss, formulating their own conclusion to approximate at least the aims of the Constitution.

It must be stressed that Section 3, Article XIII does not directly bestow on the working class any actual
enforceable right, but merely clothes it with the status of a sector for whom the Constitution urges
protection through executive or legislative action and judicial recognition. Its utility is best limited to being
an impetus not just for the executive and legislative departments, but for the judiciary as well, to protect the
welfare of the working class.

The view that the concepts of suspect classification and strict judicial scrutiny formulated in Central Bank
Employee Association exaggerate the significance of Section 3, Article XIII is a groundless
apprehension. Central Bank applied Article XIII in conjunction with the equal protection clause. Article XIII, by
itself, without the application of the equal protection clause, has no life or force of its own as elucidated
in Agabon.
Along the same line of reasoning, the Court further holds that the subject clause violates petitioner's right to
substantive due process, for it deprives him of property, consisting of monetary benefits, without any existing
valid governmental purpose.

6. · Rosario v. Victory Ricemill, G.R. No. 147572, February 19, 2003

Every employee is charged with the implicit duty of caring for the employer’s property. Petitioner’s conduct
showed that he could not even be trusted with this task. Further, his hostile attitude towards his co-workers
which eventually led him to inflict physical injuries on one of them cannot be countenanced. As correctly put
by the NLRC, petitioner’s "continuance in the service of respondent company is partly inimical not only to its
interests but also to the interest of its other employees.

To effect the dismissal of an employee, however, the law requires not only that there be just and valid cause
as provided under Article 282 of the Labor Code. It likewise enjoins the employer to afford the employee the
opportunity to be heard and to defend himself. On the latter aspect, the employer is mandated to furnish the
employee with two (2) written notices:

(a) a written notice containing a statement of the cause for the termination to afford the employee ample
opportunity to be heard and defend himself with the assistance of his representative, if he so desires;
(b) if the employer decides to terminate the services of the employee, the employer must notify him in
writing of the decision to dismiss him, stating clearly the reason therefor.

Respondent’s omission does not render petitioner’s dismissal invalid but merely ineffectual. The prevailing
rule is that when the dismissal is effected for a just and valid cause, as in this case, the failure to observe
procedural requirements does not invalidate nor nullify the dismissal of an employee. The Court had the
occasion to expound this rule in the case of Serrano in this wise:

Not all notice requirements are requirements of due process. Some are simply part of a procedure to be
followed before a right granted to a party can be exercised. Others are simply an application of the Justinian
precept, embodied in the Civil Code, to act with justice, give everyone his due, and observe honesty and good
faith toward one’s fellowmen. Such is the notice requirement in Arts. 282-283. The consequence of the
failure either of the employer or the employee to live up to this precept is to make him liable in damages, not
to render his act (dismissal or resignation, as the case may be) void. The measure of damages is the amount
of wages the employee should have received were it not for the termination of his employment without prior
notice. If warranted, nominal and moral damages may also be awarded.

We hold, therefore, that, with respect to Art. 283 of the Labor Code, the employer’s failure to comply with
the notice requirement does not constitute a denial of due process but a mere failure to observe a procedure
for the termination of employment which makes the termination of employment merely ineffectual.

It is true the Constitution regards labor as "a primary social economic force." But so does it declare that it
"recognizes the indispensable role of the private sector, encourages private enterprise, and provides
incentives to needed investment. The Constitution bids the State to "afford full protection to labor." But it is
equally true that "the law, in protecting the rights of the laborer, authorizes neither oppression nor self-
destruction of the employer. And it is oppression to compel the employer to continue in employment one
who is guilty or to force the employer to remain in operation when it is not economically in his interest to do
so.

In fine, the lack of notice and hearing is considered as being a mere failure to observe a procedure for the
termination of employment which makes the dismissal ineffectual but not necessarily illegal. The
procedural infirmity is then remedied by ordering the payment to the employee his full backwages from
the time of his dismissal until the court finally rules that the dismissal has been for a valid cause.

7. · Sameer Overseas v. Cabiles, G.R. No. 170139, August 5, 2014

that lex loci contractus (the law of the place where the contract is made) governs in this jurisdiction. There is
no question that the contract of employment in this case was perfected here in the Philippines. Therefore,
the Labor Code, its implementing rules and regulations, and other laws affecting labor apply in this
case.Furthermore, settled is the rule that the courts of the forum will not enforce any foreign claim
obnoxious to the forum’s public policy. Herein the Philippines, employment agreements are more than
contractual in nature.

To show that dismissal resulting from inefficiency in work is valid, it must be shown that:
1) the employer has set standards of conduct and workmanship against which the employee will be judged;
2) the standards of conduct and workmanship must have been communicated tothe employee; and
3) the communication was made at a reasonable time prior to the employee’s performance assessment.

This is similar to the law and jurisprudence on probationary employees, which allow termination ofthe
employee only when there is "just cause or when [the probationary employee] fails to qualify as a regular
employee in accordance with reasonable standards made known by the employer to the employee at the
time of his [or her] engagement."

A valid dismissal requires both a valid cause and adherence to the valid procedure of dismissal. The employer
is required to give the charged employee at least two written notices before termination. One of the written
notices must inform the employee of the particular acts that may cause his or her dismissal. The other notice
must "[inform] the employee of the employer’s decision." Aside from the notice requirement, the employee
must also be given "an opportunity to be heard."

8. · Tongko v. Manulife, G.R. No. 167622, November 7, 2008

9. · Serrano v. NLRC, G.R. No. 117040, January 27, 2000
10. · Agabon v. NLRC, G.R. No. 158693, November 17, 2004
11. · De Jesus v. Hon. Aquino, G.R. No. 164662, February 18, 2013
12. · Abbott v. Alcaraz, G.R. No. 192571, July 23, 2013
13. · Duncan v. Glaxo, G.R. No. 162994, September 17, 2004
14. · Yrasuegui v. PAL, G.R. No. 168081, October 17, 2008
15. · Opinaldo v. Ravina, G.R. No. 196573, October 16, 2013
16. · Phimco Industries v. PILA, G.R. No. 170830, August 11, 2010
17. · BPI v. BPI Employees, G.R. No. 164301, August 10, 2010

BANK OF THE PHILIPPINE ISLANDS, Petitioner,

vs.
BPI EMPLOYEES UNION-DAVAO CHAPTER-FEDERATION OF UNIONS IN BPI UNIBANK,
Respondent.
FACTS: On March 23, 2000, the Bangko Sentral ng Pilipinas approved the Articles of Merger
executed on January 20, 2000 by and between BPI, herein petitioner, and FEBTC. This Article and
Plan of Merger was approved by the Securities and Exchange Commission on April 7, 2000.
Pursuant to the Article and Plan of Merger, all the assets and liabilities of FEBTC were transferred to
and absorbed by BPI as the surviving corporation. FEBTC employees, including those in its different
branches across the country, were hired by petitioner as its own employees, with their status and
tenure recognized and salaries and benefits maintained.
Respondent BPI Employees Union-Davao Chapter - Federation of Unions in BPI Unibank
(hereinafter the "Union," for brevity) is the exclusive bargaining agent of BPI’s rank and file
employees in Davao City. The former FEBTC rank-and-file employees in Davao City did not belong
to any labor union at the time of the merger. Prior to the effectivity of the merger, or on March 31,
2000, respondent Union invited said FEBTC employees to a meeting regarding the Union Shop
Clause (Article II, Section 2) of the existing CBA between petitioner BPI and respondent Union.
The parties both advert to certain provisions of the existing CBA, which are quoted below:
ARTICLE I
Section 1. Recognition and Bargaining Unit – The BANK recognizes the UNION as the sole and
exclusive collective bargaining representative of all the regular rank and file employees of the Bank
offices in Davao City.
Section 2. Exclusions
Section 3. Additional Exclusions
Section 4. Copy of Contract
ARTICLE II
Section 1. Maintenance of Membership – All employees within the bargaining unit who are members
of the Union on the date of the effectivity of this Agreement as well as employees within the
bargaining unit who subsequently join or become members of the Union during the lifetime of this
Agreement shall as a condition of their continued employment with the Bank, maintain their
membership in the Union in good standing.
Section 2. Union Shop - New employees falling within the bargaining unit as defined in Article I of
this Agreement, who may hereafter be regularly employed by the Bank shall, within thirty (30)
days after they become regular employees, join the Union as a condition of their continued
employment. It is understood that membership in good standing in the Union is a condition of their
continued employment with the Bank. (Emphases supplied.)
After the meeting called by the Union, some of the former FEBTC employees joined the Union, while
others refused. Later, however, some of those who initially joined retracted their membership.
Respondent Union then sent notices to the former FEBTC employees who refused to join, as well as
those who retracted their membership, and called them to a hearing regarding the matter. When
these former FEBTC employees refused to attend the hearing, the president of the Union requested
BPI to implement the Union Shop Clause of the CBA and to terminate their employment pursuant
thereto.
After two months of management inaction on the request, respondent Union informed petitioner BPI
of its decision to refer the issue of the implementation of the Union Shop Clause of the CBA to the
Grievance Committee. However, the issue remained unresolved at this level and so it was
subsequently submitted for voluntary arbitration by the parties.

Voluntary Arbitrator Rosalina Letrondo-Montejo, in a Decision dated November 23, 2001, ruled in
favor of petitioner BPI’s interpretation that the former FEBTC employees were not covered by the
Union Security Clause of the CBA between the Union and the Bank on the ground that the said
employees were not new employees who were hired and subsequently regularized, but were
absorbed employees "by operation of law" because the "former employees of FEBTC can be
considered assets and liabilities of the absorbed corporation." The Voluntary Arbitrator
concluded that the former FEBTC employees could not be compelled to join the Union, as it was
their constitutional right to join or not to join any organization.
Respondent Union filed a Motion for Reconsideration, but the Voluntary Arbitrator denied the same
in an Order dated March 25, 2002.
Dissatisfied, respondent then appealed the Voluntary Arbitrator’s decision to the Court of Appeals. In
the herein assailed Decision dated September 30, 2003, the Court of Appeals reversed and set
aside the Decision of the Voluntary Arbitrator. Likewise, the Court of Appeals denied herein
petitioner’s Motion for Reconsideration in a Resolution dated June 9, 2004.
CA: Decision
The Court of Appeals pertinently ruled in its Decision:

A union-shop clause has been defined as a form of union security provision wherein non-
members may be hired, but to retain employment must become union members after a
certain period.
There is no question as to the existence of the union-shop clause in the CBA between the petitioner-
union and the company. The controversy lies in its application to the "absorbed" employees.

This Court agrees with the voluntary arbitrator that the ABSORBED employees are distinct and
different from NEW employees BUT only in so far as their employment service is concerned. The
distinction ends there. In the case at bar, the absorbed employees’ length of service from its former
employer is tacked with their employment with BPI. Otherwise stated, the absorbed employees
service is continuous and there is no gap in their service record.
This Court is persuaded that the similarities of "new" and "absorbed" employees far
outweighs the distinction between them. The similarities lies on the following, to wit: (a) they
have a new employer; (b) new working conditions; (c) new terms of employment and; (d) new
company policy to follow. As such, they should be considered as "new" employees for
purposes of applying the provisions of the CBA regarding the "union-shop" clause.
To rule otherwise would definitely result to a very awkward and unfair situation wherein the
"absorbed" employees shall be in a different if not, better situation than the existing BPI employees.
The existing BPI employees by virtue of the "union-shop" clause are required to pay the monthly
union dues, remain as members in good standing of the union otherwise, they shall be terminated
from the company, and other union-related obligations. On the other hand, the "absorbed"
employees shall enjoy the "fruits of labor" of the petitioner-union and its members for nothing in
exchange. Certainly, this would disturb industrial peace in the company which is the paramount
reason for the existence of the CBA and the union.
The voluntary arbitrator’s interpretation of the provisions of the CBA concerning the coverage of the
"union-shop" clause is at war with the spirit and the rationale why the Labor Code itself allows the
existence of such provision.
The Supreme Court in the case of Manila Mandarin Employees Union vs. NLRC (G.R. No. 76989,
September 29, 1987) rule, to quote:
"This Court has held that a valid form of union security, and such a provision in a collective
bargaining agreement is not a restriction of the right of freedom of association guaranteed by the
Constitution.
A closed-shop agreement is an agreement whereby an employer binds himself to hire only members
of the contracting union who must continue to remain members in good standing to keep their jobs. It
is "THE MOST PRIZED ACHIEVEMENT OF UNIONISM." IT ADDS MEMBERSHIP AND
COMPULSORY DUES. By holding out to loyal members a promise of employment in the closed-
shop, it wields group solidarity." (Emphasis supplied)
Hence, the voluntary arbitrator erred in construing the CBA literally at the expense of industrial
peace in the company.
Petitioner’s CONTENTION: Petitioner is of the position that the former FEBTC employees are not
new employees of BPI for purposes of applying the Union Shop Clause of the CBA, on this note,
petitioner points to Section 2, Article II of the CBA, which provides:

New employees falling within the bargaining unit as defined in Article I of this Agreement,
who may hereafter be regularly employed by the Bank shall, within thirty (30) days after they
become regular employees, join the Union as a condition of their continued employment. It is
understood that membership in good standing in the Union is a condition of their continued
employment with the Bank. (Emphases supplied.)

Petitioner argues that the term "new employees" in the Union Shop Clause of the CBA is qualified by
the phrases "who may hereafter be regularly employed" and "after they become regular employees"
which led petitioner to conclude that the "new employees" referred to in, and contemplated by, the
Union Shop Clause of the CBA were only those employees who were "new" to BPI, on account of
having been hired initially on a temporary or probationary status for possible regular employment at
some future date. BPI argues that the FEBTC employees absorbed by BPI cannot be considered as
"new employees" of BPI for purposes of applying the Union Shop Clause of the CBA.
According to petitioner, the contrary interpretation made by the Court of Appeals of this particular
CBA provision ignores, or even defies, what petitioner assumes as its clear meaning and scope
which allegedly contradicts the Court’s strict and restrictive enforcement of union security
agreements.

ISSUE: issue in this case is whether or not the former FEBTC employees that were absorbed
by petitioner upon the merger between FEBTC and BPI should be covered by the Union Shop
Clause found in the existing CBA between petitioner and respondent Union.

HELD: Decision dated September 30, 2003 of the Court of Appeals is AFFIRMED, subject to the
thirty (30) day notice requirement imposed herein. Former FEBTC employees who opt not to
become union members but who qualify for retirement shall receive their retirement benefits in
accordance with law, the applicable retirement plan, or the CBA, as the case may be.

In the case of Liberty Flour Mills Employees v. Liberty Flour Mills, Inc., we ruled that:

It is the policy of the State to promote unionism to enable the workers to negotiate with
management on the same level and with more persuasiveness than if they were to
individually and independently bargain for the improvement of their respective conditions. To
this end, the Constitution guarantees to them the rights "to self-organization, collective
bargaining and negotiations and peaceful concerted actions including the right to strike in
accordance with law." There is no question that these purposes could be thwarted if every
worker were to choose to go his own separate way instead of joining his co-employees in
planning collective action and presenting a united front when they sit down to bargain with
their employers. It is for this reason that the law has sanctioned stipulations for the union
shop and the closed shop as a means of encouraging the workers to join and support the
labor union of their own choice as their representative in the negotiation of their demands
and the protection of their interest vis-à-vis the employer. (Emphasis ours.)

In other words, the purpose of a union shop or other union security arrangement is to guarantee the
continued existence of the union through enforced membership for the benefit of the workers.
All employees in the bargaining unit covered by a Union Shop Clause in their CBA with management
are subject to its terms. However, under law and jurisprudence, the following kinds of
employees are exempted from its coverage, namely, employees who at the time the union shop
agreement takes effect are bona fide members of a religious organization which prohibits its
members from joining labor unions on religious grounds; employees already in the service and
already members of a union other than the majority at the time the union shop agreement
took effect; confidential employees who are excluded from the rank and file bargaining unit; and
employees excluded from the union shop by express terms of the agreement.
When certain employees are obliged to join a particular union as a requisite for continued
employment, as in the case of Union Security Clauses, this condition is a valid restriction of the
freedom or right not to join any labor organization because it is in favor of unionism. This Court, on
occasion, has even held that a union security clause in a CBA is not a restriction of the right of
freedom of association guaranteed by the Constitution.
Moreover, a closed shop agreement is an agreement whereby an employer binds himself to hire
only members of the contracting union who must continue to remain members in good standing to
keep their jobs. It is "the most prized achievement of unionism." It adds membership and
compulsory dues. By holding out to loyal members a promise of employment in the closed shop, it
wields group solidarity.
Indeed, the situation of the former FEBTC employees in this case clearly does not fall within the first
three exceptions to the application of the Union Shop Clause discussed earlier. No allegation or
evidence of religious exemption or prior membership in another union or engagement as a
confidential employee was presented by both parties. The sole category therefore in which petitioner
may prove its claim is the fourth recognized exception or whether the former FEBTC employees are
excluded by the express terms of the existing CBA between petitioner and respondent.

18. · Pryce Corp. v. Chinabank, G.R. No. 172302, February 18, 2014
19. · Abella v. NLRC, G.R. No. 71813, July 20, 1987
20. · Goya v. Goya Employees, G.R. No. 170054, January 21, 2013
21. · Imbong v. Ochoa, G.R. No. 204819, April 8, 2014
22. · International School v. Quisumbing, G.R. No. 128845, June 1, 2000
23. · See: Serrano v. Gallant Maritime, G.R. No. 167614, March 24, 2009
24. · Canuel v. Magsaysay Maritime, G.R. No. 190161, October 13, 2014
25. · Asia Brewery v. TPMA, G.R. Nos. 171594-96, September 18, 2013

B. Civil Code

1. Article 19
2. Article 1700
3. Article 1702

· Dongon v. Rapid Movers, G.R. No. 163431, August 28, 2013

· Cirtex Employees v. Cirtex, G.R. No. 190515, November 15, 2010
· PNCC Traffic v. PNCC, G.R. No. 171231, February 17, 2010
· Magis Center v. Manalo, G.R. No. 178835, February 13, 2009

C. Labor Code

1. Article 3
2. Article 4
3. Article 166
4. Article 211
5. Article 212
6. Article 255
7. Article 277

· Moresco v. Cagalawan, G.R. No. 175170, September 5, 2012

· PAL v. PALEA, G.R. No. 85985, August 13, 1993